Over half (56%) of Shawbrook clients are planning on purchasing a buy-to-let property within the next 12 months, according to the challenger banks Client Barometer.
With changes in tax approaching, Shawbrook found that almost two fifths (40%) plan to set up a limited company for their properties to counter the impact of tax changes, whilst just over a third (33%) plan to raise rents.
While the outlook for investors remains positive, new changes to tax relief and stamp duty have caused some investors to check their ambitions.
Of the 44% who are not planning on purchasing a new BTL property this year, just over a third (37%) said it was due to the 20% cap on tax relief for BTL properties making the proposition unattractive, whilst almost a fifth (16%) said the 3% extra stamp duty levy on second homes and BTLs was putting them off.
Karen Bennett, sales and marketing director, commercial mortgages, said: “As a lender it is always great to see such positivity in the market, and as with our Broker Barometer conducted in late 2015, it seems that there is a lot of optimism amongst property professionals also. Obviously the new changes will have an effect and may instil more caution across the market; however, Shawbrook is well-placed to adapt to change, and we are expecting the market to remain buoyant.”
The latest figures also revealed that almost half (49%) of clients said they considered regulation to be the biggest challenge facing property investors over the next six months, a significant increase on last year’s Barometer results, which found that regulation was something only 23% of investors considered to be the biggest challenge they faced.
Despite these challenges over two thirds (61%) have a positive outlook for the upcoming 12 months, predicting either a large or small increase in property value. In total 43% of landlords saw an increase in tenant demand in 2015 and nearly two thirds (61%) saw an increase in their rental income. A further 44% are confident that their business will grow in 2016.
The Client Barometer surveyed of over 170 property investors.
